Bitcoin's price has been in freefall this week as the values of its sister cryptocurrencies also plummeted. At 16:00 UTC, the price of one bitcoin hovered at $9,757, down 8.6% from 24 hours earlier, according to WorldCoinIndex.

The dramatic price drop occurred shortly after the Securities and Exchange Commission said it will require cryptocurrency exchanges to register with the agency.

Until now, the opaque crypto market has been largely unregulated. In a statement this afternoon, the SEC explained why it plans to change that:

If a platform offers trading of digital assets that are securities and operates as an 'exchange,' as defined by the federal securities laws, then the platform must register with the SEC as a national securities exchange or be exempt from registration."

The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not. Many platforms refer to themselves as "exchanges," which can give the misimpression to investors that they are regulated or meet the regulatory standards of a national securities exchange.

Nine of the top 10 most valuable cryptocurrencies, including Ethereum, Litecoin, and Ripple also fell. The only exception was Viacoin, which was up 46% as of this writing.

There are longstanding rumors that bitcoin prices are being manipulated by "bitcoin whales," or individuals who hold huge amounts of BTC. About 1,000 people hold 40% of all the bitcoin in the world, according to Bloomberg, so it's no surprise they exert a disproportionate impact on BTC price movements.

Today, one bitcoin whale revealed that he has sold about $400 million in bitcoin and Bitcoin Cash since September 2017. Nobuaki Kobayashi, a Tokyo-based attorney and bankruptcy trustee for the now-defunct Mt. Gox crypto exchange, said he's raising money to pay off Mt. Gox creditors.

Mt. Gox, which operated between 2010 and 2014, was once the world's largest cryptocurrency exchange, handling 70% to 80% of all trading in the world. The platform went bankrupt in 2014 after it lost 850,000 bitcoins (worth about $500 million) due to a hack.

Trading Volume Craters to Two-Year Low

Perhaps not surprisingly, BTC trading volume has climbed slightly as its price has crumbled. Still, the volume remains muted compared to the record high it posted on December 13, 2017, when confirmed transactions topped 490,000 in one day, according to Blockchain.info.

Bitcoin trading volume then plunged to a two-year low on February 26, 2018, with only 180,000 confirmed transactions. While trading has since picked up, it's still relatively anemic. (See more: Bitcoin Trading Volume Plunges to Two-Year Low.)

One week later, Coinbase – the world's most popular bitcoin exchange – got slapped with two federal class action lawsuits amid allegations of insider trading. When you're making waves like that, it's no wonder the government is starting to step in. (See more: Coinbase Hit With 2 Class Action Lawsuits.)

Investing in cryptocurrencies and Initial Coin Offerings ("ICOs") is highly risky and speculative, and this article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies or ICOs. Since each individual's situation is unique, a qualified professional should always be consulted before making any financial decisions. Investopedia makes no representations or warranties as to the accuracy or timeliness of the information contained herein. As of the date this article was written, the author owns no cryptocurrencies.